if john has a balance of 2195. after 3 years what will be the amount of the interest at 8%. compounded semiannually
Pt = Po(1+r)^n,
r = APR/2 = 8% / 2 = 4% = .04.
n = 2 comp/yr * 3yrs = 6 comp. periods.
Pt = 2195(1.04)^6 = $2777.38.
Int. = 2777.38 - 2195 = $552.38.